Housing shortage pushes up prices in Scotland

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According to a new survey, Scottish house prices are on the rise and are set to increase by around 25 per cent over the next five years…

A new survey from RICS has revealed Scottish house prices are set to increase by 4.2 per cent per annum over the next five years, seeing a cumulative increase of around 25 per cent.

The figures, which formed part of the RICS UK Residential Market Survey, showed a shortage of housing stock was leading to an increase in price growth, depsite a slight decrease in buyer demand.

A total of 38 per cent more chartered surveyors reported house prices rose, rather than fell. Additionally, the outlook over the next 12 months is also expected to improve, with a net balance of 54 per cent expecting to see an increase in prices.

This news comes even as demand from buyers saw a decline in October, ending a run of steady growth over the past 12 months. Despite this, sales activity continued to rise in Scotland, seeing a net balance of 26 per cent more transactions in October.

Director RICS in Scotland Sarah Speirs said: “It is hard to get away from the issue of supply when it comes to the current state of the housing market.

“The legacy of the drop in new build following the onset of the global financial crisis is now really hitting home with both the sales and letting markets continuing to show demand outstripping supply on a month by month basis.

“RICS would like to see a commitment from the next Scottish Government administration that delivers a definite plan for delivering attainable targets across all housing tenures to ensure that supply needs are met.”

Growth was also reported in the Scottish letting market, which saw demand outpace supply in the three months to October. Expectations for the rental market are high, with 12 per cent of respondents expecting rents to increase in the next three months.

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